DB:5UI

Stock Analysis Report

Universal Insurance Holdings

Executive Summary

Universal Insurance Holdings, Inc., together with its subsidiaries, operates as an integrated insurance holding company in the United States.

Rewards

Trading at 64.4% below its fair value

Earnings are forecast to grow 39.53% per year

Risk Analysis

Unstable dividend track record

Profit margins (9.9%) are lower than last year (19.8%)



Snowflake Analysis

Undervalued with high growth potential and pays a dividend.


Similar Companies

Share Price & News

How has Universal Insurance Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 5UI has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

5UI

0.4%

DE Insurance

0.07%

DE Market


1 Year Return

-29.9%

5UI

27.1%

DE Insurance

14.8%

DE Market

Return vs Industry: 5UI underperformed the German Insurance industry which returned 29.2% over the past year.

Return vs Market: 5UI underperformed the German Market which returned 17.1% over the past year.


Shareholder returns

5UIIndustryMarket
7 Day0.9%0.4%0.07%
30 Day-12.0%0.3%1.4%
90 Day-9.3%4.3%6.1%
1 Year-28.0%-29.9%32.7%27.1%18.4%14.8%
3 Year-0.3%-7.7%64.7%44.8%17.4%7.0%
5 Year32.3%15.5%95.1%56.2%27.9%10.4%

Price Volatility Vs. Market

How volatile is Universal Insurance Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Universal Insurance Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 5UI (€22.6) is trading below our estimate of fair value (€63.56)

Significantly Below Fair Value: 5UI is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 5UI is good value based on its PE Ratio (9.7x) compared to the Insurance industry average (11.9x).

PE vs Market: 5UI is good value based on its PE Ratio (9.7x) compared to the German market (20.6x).


Price to Earnings Growth Ratio

PEG Ratio: 5UI is good value based on its PEG Ratio (0.2x)


Price to Book Ratio

PB vs Industry: 5UI is overvalued based on its PB Ratio (1.5x) compared to the DE Insurance industry average (1.1x).


Next Steps

Future Growth

How is Universal Insurance Holdings forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

39.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 5UI's forecast earnings growth (39.5% per year) is above the savings rate (-0.4%).

Earnings vs Market: 5UI's earnings (39.5% per year) are forecast to grow faster than the German market (13.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 5UI's revenue (8.7% per year) is forecast to grow faster than the German market (4.8% per year).

High Growth Revenue: 5UI's revenue (8.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 5UI's Return on Equity is forecast to be high in 3 years time (23.2%)


Next Steps

Past Performance

How has Universal Insurance Holdings performed over the past 5 years?

7.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 5UI has high quality earnings.

Growing Profit Margin: 5UI's current net profit margins (9.9%) are lower than last year (19.8%).


Past Earnings Growth Analysis

Earnings Trend: 5UI's earnings have grown by 7.3% per year over the past 5 years.

Accelerating Growth: 5UI's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 5UI had negative earnings growth (-43%) over the past year, making it difficult to compare to the Insurance industry average (7.8%).


Return on Equity

High ROE: 5UI's Return on Equity (16%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Universal Insurance Holdings's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: 5UI has a low level of unsold assets or inventory.

Debt Coverage by Assets: 5UI's debt is covered by short term assets (assets are 61.7x debt).


Financial Institutions Analysis

Asset Level: 5UI's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if 5UI has a sufficient allowance for bad loans.

Low Risk Liabilities: 5UI reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if 5UI has an acceptable proportion of non-loan assets held.

Low Risk Deposits: 5UI has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if 5UI has an appropriate level of bad loans.


Next Steps

Dividend

What is Universal Insurance Holdings's current dividend yield, its reliability and sustainability?

2.96%

Current Dividend Yield


Dividend Yield vs Market

company3.0%marketbottom25%1.4%markettop25%3.5%industryaverage3.7%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: 5UI's dividend (2.99%) is higher than the bottom 25% of dividend payers in the German market (1.38%).

High Dividend: 5UI's dividend (2.99%) is low compared to the top 25% of dividend payers in the German market (3.53%).


Stability and Growth of Payments

Stable Dividend: 5UI's dividend payments have been volatile in the past 10 years.

Growing Dividend: 5UI's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (24.1%), 5UI's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 5UI's dividends in 3 years are forecast to be well covered by earnings (21% payout ratio).


Next Steps

Management

What is the CEO of Universal Insurance Holdings's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average management tenure


CEO

Steve Donaghy (54yo)

0.5yrs

Tenure

US$2,623,334

Compensation

Mr. Stephen J. Donaghy has been Chief Executive Officer of Universal Insurance Holdings, Inc. since July 15, 2019. Mr. Donaghy was Chief Operating Officer of Universal Insurance Holdings Inc. since March 2 ...


CEO Compensation Analysis

Compensation vs Market: Steve's total compensation ($USD2.62M) is above average for companies of similar size in the German market ($USD1.28M).

Compensation vs Earnings: Steve's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.8yrs

Average Tenure

53yo

Average Age

Experienced Management: 5UI's management team is considered experienced (3.8 years average tenure).


Board Age and Tenure

6.4yrs

Average Tenure

51yo

Average Age

Experienced Board: 5UI's board of directors are considered experienced (6.4 years average tenure).


Insider Trading

Insider Buying: 5UI insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Buy€150,89216 Dec 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares6,000
Max Price€25.18
Buy€25,80004 Dec 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares1,000
Max Price€25.80
Buy€131,85625 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares5,000
Max Price€26.37
Buy€79,09321 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares3,000
Max Price€26.36
Buy€55,56920 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares2,100
Max Price€26.46
Buy€67,46812 Nov 19
Michael Pietrangelo
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares2,500
Max Price€26.99
Buy€44,36307 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares1,700
Max Price€26.10
Buy€89,63506 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares3,600
Max Price€24.90
Buy€157,04505 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares6,467
Max Price€24.28
Buy€123,01405 Nov 19
Stephen Donaghy
EntityIndividual
Role
Chief Executive Officer
Chief Executive Officer
Shares5,000
Max Price€24.60
Buy€135,90404 Nov 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares5,500
Max Price€24.71
Buy€179,00209 Aug 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares7,000
Max Price€25.57
Buy€237,85506 Aug 19
Stephen Donaghy
EntityIndividual
Role
Chief Executive Officer
Chief Executive Officer
Shares10,000
Max Price€23.79
Buy€26,21605 Aug 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares1,100
Max Price€23.83
Buy€77,29314 Jun 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares3,000
Max Price€25.76
Buy€63,81611 Jun 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares2,500
Max Price€25.53
Buy€255,04828 May 19
Sean Downes
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares10,000
Max Price€25.50
Buy€556,66808 Mar 19
Stephen Donaghy
EntityIndividual
Role
Chief Executive Officer
Chief Executive Officer
Shares20,000
Max Price€27.83
Buy€19,90706 Mar 19
Frank Wilcox
EntityIndividual
Role
Chief Financial Officer
CFO & Principal Accounting Officer
Shares700
Max Price€28.49

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Jim Lynch (64yo)

    Director of Financial Analysis

    • Tenure: 9.3yrs
    • Compensation: US$909.57k
  • Sean Downes (49yo)

    Executive Chairman

    • Tenure: 6.4yrs
    • Compensation: US$17.92m
  • Jon Springer (49yo)

    President

    • Tenure: 6.9yrs
    • Compensation: US$7.21m
  • Steve Donaghy (54yo)

    Chief Executive Officer

    • Tenure: 0.5yrs
    • Compensation: US$2.62m
  • Darryl Lewis (54yo)

    Chief Legal Officer

    • Tenure: 1.4yrs
    • Compensation: US$58.33k
  • Frank Wilcox (53yo)

    CFO & Principal Accounting Officer

    • Tenure: 6.3yrs
    • Compensation: US$2.31m
  • Kim Campos (41yo)

    Chief Information Officer

    • Tenure: 3yrs
    • Compensation: US$445.37k
  • Rob Luther

    Vice President of Corporate Development


    Board Members

    • Mike Pietrangelo (77yo)

      Lead Independent Director

      • Tenure: 6yrs
      • Compensation: US$100.00k
    • Joel Wilentz (84yo)

      Independent Director

      • Tenure: 22.8yrs
      • Compensation: US$85.00k
    • Scott Callahan (65yo)

      Independent Director

      • Tenure: 6.6yrs
      • Compensation: US$85.00k
    • Sean Downes (49yo)

      Executive Chairman

      • Tenure: 6.4yrs
      • Compensation: US$17.92m
    • Ozzie Schindler (50yo)

      Independent Director

      • Tenure: 13yrs
      • Compensation: US$91.25k
    • Ralph Palmieri (72yo)

      Independent Director

      • Tenure: 5.6yrs
      • Compensation: US$100.00k
    • Jon Springer (49yo)

      President

      • Tenure: 6.9yrs
      • Compensation: US$7.21m
    • Ric Peterson (51yo)

      Independent Director

      • Tenure: 5.6yrs
      • Compensation: US$100.00k
    • Kim Campos (41yo)

      Chief Information Officer

      • Tenure: 3yrs
      • Compensation: US$445.37k

    Company Information

    Universal Insurance Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Universal Insurance Holdings, Inc.
    • Ticker: 5UI
    • Exchange: DB
    • Founded: 1990
    • Industry: Property and Casualty Insurance
    • Sector: Insurance
    • Market Cap: US$863.831m
    • Listing Market Cap: US$778.743m
    • Shares outstanding: 33.21m
    • Website: https://www.universalinsuranceholdings.com

    Number of Employees


    Location

    • Universal Insurance Holdings, Inc.
    • 1110 West Commercial Boulevard
    • Suite 100
    • Fort Lauderdale
    • Florida
    • 33309
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    UVENYSE (New York Stock Exchange)YesCommon StockUSUSDDec 1992
    5UIDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1992

    Biography

    Universal Insurance Holdings, Inc., together with its subsidiaries, operates as an integrated insurance holding company in the United States. The company develops, markets, and underwrites insurance products for personal residential homeowner’s insurance. It also provides personal residential insurance, such as homeowners, renters/tenants, condo unit owners, and dwelling/fire, and commercial residential multi-peril; and allied lines, coverage for other structures, and personal property, as well as liability and personal articles coverages. In addition, the company offers policy and claims administration, and reinsurance intermediary services, as well as operates Universal Direct, a direct-to-consumer online platform, which enables homeowners to directly purchase, pay for, and bind homeowners’ policies. It provides its products through a network of independent agents. The company was formerly known as Universal Heights, Inc. and changed its name to Universal Insurance Holdings, Inc. in January 2001. Universal Insurance Holdings, Inc. was founded in 1990 and is headquartered in Fort Lauderdale, Florida. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/19 21:44
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.